Corporate SocialResponsibility Report 2015

This report has been printed onenvironment friendly paper.

Address by the Chairman of the Management Board 4

Eesti Energia at a Glance 9

Strategy 13

Tax Footprint 19

Corporate Governance and Risk Management 21

Eesti Energia as an Employer 37

Customer Relations 49

Environmental Activities 65

Social Activities 73

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Hando SutterChairman of the Management Board

DEAR READER!

Being the largest enterprise in Estonia the operations of

Eesti Energia have impact on most of us. The decisions

taken by Eesti Energia are directly influencing all of our

6,000 employees and people living in Ida-Virumaa region,

heart of our production. We appreciate highly our more

than half a million customers in the Baltic countries. We

are working hard for gaining trust and contentment, the

foundation for long-term customer relations.

As a production organisation we are constantly monito-

ring the impact we have on environment and continue

working on reducing such effect. Today we can proudly

say that energy generation has become cleaner and

more sustainable than ever before. The more stringent

EU environment requirements were enforced on

combustion plants from 2016.

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Over the years we have put a lot of effort and investments

into more sustainable energy production. During the past

decade we renovated two energy units of Narva power

plants. Other energy units where pulverised combustion

technology is used are now supplied with filtering equip-

ment and denitrification (DeNox) and desulphurisation

(DeSOx) systems. Since 2010, Narva power plants have

invested EUR 134 million to comply with the emission

standards as a result of what the air pollution has declined

several times. All in all we have invested more than a

billion euros over the last ten years to a more sustainable

technology and reduction of environment pollution. The

surveys indicate that Estonia has one of the lowest air

pollution levels in all Europe.

We aim to increase the utilisation of by-products

of energy generation to add more value to oil shale.

We have identified the increased utilisation of by-

products as a strategic development area. Waste rock,

a product from oil shale enrichment, is basically a lime-

stone, basis for crushed stone and valuable construction

material. Oil shale ash can also be successfully used as

a construction material or soil improver as its alkaline

consistence neutralises the acidic soil.

Today we can proudly say that energy generation has become cleaner and more sustainable than ever before.

Adding more value to oil shale is one of the most impor-

tant goals for Eesti Energia and its owners.

In 2015 Eesti Energia retained its leading market posi-

tion and customer contentment with our service quality

remained high. While the market has been opened for

competition for three years by now majority of home

consumers prefer Eesti Energia as their primary service

provider. To make the lives of our customers easier we

introduced a mobile app for taking care energy related

matters. By the end of 2015 the app already had 25,000

users. Since customers prefer handing their energy rela-

ted matters outside of service centres we reorganised

our customer service in 2015.

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The most valuable asset of Eesti Energia is its employees.

We are proud to see that Eesti Energia is continuously

considered an attractive employer as indicated by high

positions in different employer preference surveys. We

were also awarded with golden label by Responsible Busi-

ness Forum. The recognition goes to an enterprise that

values sustainable development and has strategic focus

on sustainable operations, employees, customers and

community involvement. In previous years we were always

awarded with silver label. Our ambition is to manage and

improve Eesti Energia in a way that we would be a role

model for other companies.

Eesti Energia has introduced and is continuously impro-

ving a number of programs for developing its employees

and attracting new talented people. The future of the

organisation and Estonian energy sector in general are

dependent on how many young people choose their

careers in engineering. Besides existing scholarship

programs we launched in 2015 a new young engineer

improvement program Insenergia. As part of the prog-

ram students of engineering faculty could solve real-

life problems with top engineers of Eesti Energia.

2015 was not an easy year. Low energy and oil prices

made us review all expenses and find ways to increase

the efficiency. This included both technological solutions

and reduction of employees.

Regretfully, we had some very serious work accidents in

2015. In January two very experienced miners died in

Estonia mine. We are still investigating the causes and

work closely with the investigators. I can assure that there

will be no indulgence of safety. Safety is our core value

and we do everything to keep our employees healthy

and safe. In addition to safety trainings and requirements

we established also a Board of Work Safety to promote

the safety culture.

Our sponsorship focuses on Ida-Virumaa, a region that

accommodates oil shale, the national wealth, and our

production units. I would like to emphasise the reviving

of former oil shale enrichment plant as a museum in

Kohtla-Nõmme last year as part of our sponsorship. All

We are proud to see that Eesti Energia is continuously consi-dered an attractive employer.

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HANDO SUTTER

Chairman of the Management Board

in all Eesti Energia invested more than 0.5 million euros

to different support activities in 2015.

Oil shale industry has played a key role over the last

few years in turning Estonia into one of the least energy

dependent countries in European Union. We have gene-

rated energy from oil shale for more than 100 years

Oil shale industry has played a key role over the last few years in turning Estonia into one of the least energy dependent countries in European Union.

and to celebrate this event we will host an international

oil shale conference in September 2016. Over the 100

years we have learned significantly and have adapted to

changing environment. Our unique expertise is widely

valued around the world.

Improvement of existing experience, reasonable utilisa-

tion of resources and increased usefulness are creating

a value to work for every day in this company. Caring and

responsibility are inseparable in achieving this.

CONTENTSCONTENTS

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NET PROFIT

-74.6%

-118.8

million euros

40.5

INVESTMENTS

-11.0%

-30.2

million euros

245.6

CREDIT RATINGS

BBB/ Baa2

ELECTRICITY SALES

-21.1%

-1.97.2

TWh

ELECTRICITY DISTRIBUTED

+0.7%

+0.04

TWh

6.3

SHALE OIL SALES

+36.6%

+84.4

thousand t

315.0

SALES REVENUES

-11.7%

-103.2

million euros

776.7

EBITDA

-14.9%

-46.5

million euros

265.8

(rating under reviewfor downgrade)

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ESTONIA

LATVIA

LITHUANIA

BELARUS

UKRAINE

POLAND

GERMANY

CZECH REPUBLIC

AUSTRIAHUNGARY

ROMANIA

SLOVAKIA

FINLAND

RUSSIA

SWEDEN

NORWAY

FRANCE

Eesti Energia offers energy solutions ranging from elect-

ricity, heat and fuel production to sales, customer service

and ancillary energy services. Eesti Energia sells electricity

to the Baltic retail customers and the wholesale market

and Group entity Elektrilevi distributes electricity to cus-

tomers in Estonia. Outside Estonia, the Group operates

under the Enefit brand.

With its approximately 6,300 employees, Eesti Energia

is one of the largest employers in Estonia.

EESTI ENERGIA AT A GLANCE

Eesti Energia is an international energy company that operates in the unified electricity market of the Baltic and Nordic count-ries. Its sole shareholder is the Republic of Estonia.

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Key Events of 2015

Estonian recruitment website CV Keskus awarded Eesti Energia with the Best Employer of 2014 title.

Eesti Energia was awarded with cor-porate responsibility and social and environment sustainability quality label.

Eesti Energia, Viru Keemia Grupp and Eastman Specialities signed a goodwill

agreement with Jõhvi Gymnasium to increase the interest of local

youth in studying engineering in Ida-Virumaa region.

We contributed to the oil shale exhibition in former oil shale

enrichment factory opened in Kohtla Mining Museum.

Traditional community event in Pähklimäe health trails to clean sporting trails and prepare for Narva Energy Run.

Eesti Energia and Looduse Omnibuss awarded the best contestants of largest Estonian nature photo contest “Nature Photo of 2015”.

The best start-ups of the fifth youth deve-lopment program ENTRUM announced. The winner Viru Ilu, a start-up from Virumaa region, uses local clay to produce soap.

JANUARY FEBRUARY MARCH MAY JUNE

Launching Insenergia, an improvement program targeting talented engineers.

The program provided 15 students with unique opportunity to solve

real-life engineering tasks.

All 500 employees previously scattered around Tallinn in different offices are moved to one office building. New office building helps us to improve cooperation, is cost effective and complies with B energy class.

Ida-Virumaa Talented Youth Energy Fund scholarships granted.

Eesti Energia ranks first in the EMOR employer reputation survey.

Fifth Narva Energy Run reaches 4,000 participants, a record of all times.

The sports event is followed by Energy Day in Narva castle.

Establishing Board for Work Safety to advance intragroup safety culture.

Recreational sports campaign to encourage employees to take stairs

and spend more time on health trails. The campaign attracted more than 300 people who covered close to

13,000 km.

APRIL

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About 3,000 children take the training on how to notice electrical hazards during the traditional national safety campaign organised by Elektrilevi.

Eesti Energia and Tallinn Technical University team up in lecturing about the challenges in strategic management of energy sector.

Watersports centre on Aidu opencast mine area voted as the 8th of the “Top 100 Estonian treasures”, a public vote to find the Estonian treasures as part of celebra-ting the country’s 100th anniversary.

Environment Day takes place. Eesti Energia is compliant with all new

environment requirements concerning electricity generation.

Employee design contest was organised to find feasible solution for the usage

of waste rock. The students of Estonian University of Life Science under the supervision of the employees of Oil

Shale Competency Centre are looking for alternative use for waste rock.

Ida-Virumaa Talented Youth Energy Fund scholarships granted.

JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER

As part of Energy Saving week we conducted video contest to find energy saving tips. More than 20 videos were submitted receiving over 100,000 views on Facebook.

Eesti Energia Kaevandused grants scho-larship to six geo-technology students.

Elektrilevi and voluntary rescue workers from Järvamaa region sign

cooperation agreement.

Water tour with hundreds of partici-pants in watersports centre in former

Aidu opencast mine.

All first graders of the employees of Eesti Energia Kaevandused receive

schoolbag as a gift.

Miners’ Day, the most loved event in Ida-Virumaa region, is held in Kohtla

Mining Museum. Best miners are awarded.

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STRATEGY

Eesti Energia’s strategy was approved by the Supervisory

Board in December 2013. In spring 2015, strategic action

plans were reviewed due to significant changes in market

conditions. According to updated action plans, the Group

targets higher operating efficiency but also undertakes

development projects that will contribute to operating

income within the next five years.

To achieve higher cost efficiency, the Group is seeking to

halt the rise in the product cost of oil shale by adjusting

the mines’ extraction volumes to the Group’s competitive

electricity generation. Mining efficiency has been imp-

roved by the implementation of dual dragline systems

and in 2016 larger loaders and longwall mining will be

implemented. In connection with changes made to imp-

rove mining operating efficiency and flexibility, number

of miners was reduced by around 200 in 2015.

In 2015, the Group’s oil production grew to 336.5 thou-

sand tonnes. To sustain gradual output growth, the Group

is planning to reduce down time and increase load of

Enefit280 oil plant. Focus areas include development

projects that increase oil output such as purification of

heavy fuel oil and gasoline extraction from oil shale gas.

The decision on whether the Group will invest in gasoline

extraction from oil shale gas is expected to be made at

the beginning of 2017. In the event of a positive deci-

sion, the equipment should start operating in 2018. The

first heavy fuel oil purification tests will be conducted in

2016. The Group is seeking and testing different more

competitive fuel mixes for producing electricity and oil.

In August 2015, a procurement tender was announced

for increasing the share of oil shale gas in generating

unit 8 of the Eesti power plant to 50%. The upgrade will

allow utilising the gas produced by the oil plants more

efficiently, reducing emissions to the environment and

operating the power plants more flexibly. Work should

be completed by the end of 2018.

Eesti Energia’s operation is based on effective value adding to energy resources which is mainly to be achieved through efficient cogeneration of oil and electricity, as well as value creation from renewable energy resources, sales of energy and services, and provision of the distribution service.

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customers of only Elektrilevi (the subsidiary that operates

the distribution network) in major centres of the country.

For higher cost efficiency, the Group continued streamli-

ning its Support Services: different procurement functions

were integrated into a single Procurement Service, the

real estate and secretarial functions were merged into the

Administrative Service and the Group’s human resource

staff was brought together into a single HR Service.

Although by 2015 a period of major environmental

investments had ended, work aimed at improving the

efficiency and reducing the environmental impacts of oil

shale processing continued. The Group is working hard to

increase the utilisation of energy production by-products

and has launched numerous research and development

projects to find ways for expanding the use of waste rock

and oil shale ash. For example using waste rock in road

construction or using oil shale ash to improve the soil

quality in agriculture and reforestation.

In response to the volatility of prices on the power exc-

hange, the Group will continue planning the load of the

Narva power plants according to the market price of

electricity. In the field of renewable energy the Group

is carrying out a pre-development considering building

a wind park in Pärnu County, Estonia, investment will be

decided in 2017 the earliest.

In 2015, electricity and oil derivatives transactions yielded

a gain of EUR 72.0 million. In a couple of years previously

secured higher-price hedges will mature and this will

impact the Group’s results if electricity prices remain

low subsequently.

In the retail sale of electricity, the focus of 2015 was

on improving business process efficiency. As customers

and purchasing decisions are increasingly shifting into

the e-channels, enhancing online and mobile solutions

has become a priority. In 2015, customer service was

adjusted so that office-based services are available to the

In 2015, electricity and oil derivatives transactions yieldeda gain of EUR 72.0 million.

All of Elektrilevi’s customers will have a remote reading meter by the end of 2016.

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111 91 93 67

213 187 144 102

166 269

490 278 507 1980

6

12

18

24

301,000

800

600

400

200

0

2011 2012 2013 2014

SAIDI / Minutes per Customer Amount of Outages / th

Impact of storms in unplanned SAIDI

Unplanned SAIDI (excl. storms) Amount of outages (right sc.)

Planned SAIDI

Amount and Duration of Outages in theDistribution Network of Elektrilevi

74131

2612015

The objective of the distribution network operator Elektri-

levi is to manage the network efficiently and to increase

customer satisfaction. Elektrilevi has to ensure that all

market participants have equal access to network ser-

vice and that the quality requirements established by the

regulator are met.

In 2015, Elektrilevi continued to install remote reading

meters. All of Elektrilevi’s customers will have a remote

reading meter by the end of 2016. The project involves

installing around 620,000 smart meters that record elect-

ricity consumption on an hourly basis. The new meters

release the customers from the obligation to submit the

reading and allow them to make more informed deci-

sions regarding their consumption and selection of the

electricity package.

The distribution network operator invests consistently in

network reliability. Even though the number of service

interruptions is strongly influenced by weather conditions,

recent years’ decrease in the number and duration of

outages reflects that the distribution network has become

more reliable.

Elektrilevi wishes to continue to ensure the security of

supply that meets the customer’s expectations by inves-

ting in the network’s storm resistance and reducing the

duration of power outages. Efforts are made to develop

solutions that improve service quality and, at the same

time, reduce network size i.e. the length of cables and

amount of substations and increase investment efficiency.

In sparsely populated areas the distribution network ope-

rator plans to develop distributed generation solutions,

which could prove more cost-effective and replace the

network at the consumption.

Estonian oil shale was formed in shallow seawater

450 million years ago

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Tax Payments in Estonia by Eesti Energia Group* (million euros)

TAXES PAID IN ESTONIA 2015

IN ESTONIA 2014 CHANGE CHANGE

Payroll taxes (social tax, employer unemployment insurance)

39.5 40.2 -0.7 -2%

Environment charges: resource charges 28.6 25.9 2.7 10%

Environment charges: pollution charges 28.9 28.3 0.6 2%

Corporate income tax 0.4 28.8 -28.4 -99%

Customs VAT 0.4 0.5 -0.1 -20%

Land tax 0.3 0.4 -0.1 -25%

TOTAL TAXES PAID 98.1 124.1 -26.0 -21%

TAXES COLLECTED

Excise taxes 30.1 29.2 0.9 3%

Payroll taxes (income tax, employee unemployment insurance, pension payment)

23.8 25.5 -1.7 -7%

VAT (balance) 19.0 25.1 -6.1 -24%

TOTAL TAXES COLLECTED 72.9 79.8 -6.9 -9%

TOTAL TAXES 171.0 203.9 -32.9 -16%

* cash based

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TAX FOOTPRINT

Our tax footprint reflects taxes paid and taxes collected.

Taxes paid represent taxes that are carried by the entities

of Eesti Energia Group. Taxes collected represent taxes

that are collected from customers and employees on

behalf of government. Eesti Energia considers its obli-

gation the timely and correct payment of all taxes thus

contributing to the economies where it conducts it busi-

ness operations. The Group prioritizes openness, honesty

and transparency with tax authorities.

With 63.3 million euros Eesti Energia Group is by far the

largest payroll tax payer of all companies operating in

Estonia. The cost of environmental taxes and charges is

the largest tax expense besides payroll taxes. Environ-

mental charges are used to finance the preservation of

environmental status for specific purposes, reproduction

of natural resources and rectification of environmental

damage among other things.

Compared to previous year the tax payments were mostly

impacted by corporate income tax. Since the dividends

were paid out in December 2015 the corporate income

tax is reported in 2016.

With 63.3 million euros Eesti Energia Group is by far the largest payroll tax payer of all companies operating in Estonia.

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CORPORATE GOVERNANCE AND RISK MANAGEMENT

Eesti Energia’s sole shareholder is the Republic of Estonia

that maintains an ownership interest in Eesti Energia in

order to:

• add maximum value to Estonia’s primary natural

resource, oil shale, and related expertise;

• grow the company’s value and ensure stable

dividend income;

• ensure the security of power supply in Estonia;

• provide employment for regional labour

resources; and

• reduce adverse environmental impacts

Eesti Energia’s Supervisory Board and Management Board

share the ambition to develop and manage Eesti Ener-

gia so that it would be a positive example for all other

Estonian companies in terms of clarity of strategy, good

corporate governance practices, operating efficiency and

financial performance as well as collaboration with all

relevant stakeholders.

Designing and implementing the company’s strategic

directions is the responsibility of the Chairman of the

Management Board who composes his or her own team

and agrees it with the Supervisory Board.

Key determinants of Eesti Energia’s management are the

owner’s expectations, the Group’s vision, agreed strategic

objectives and values, and the laws, regulations and other

documents that regulate the operation of the Group and

all its entities.

Eesti Energia’s corporate governance policies are aimed at ensuring that the Group is consistently and transparentlymanaged.

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Energy trading

EESTI ENERGIA AS

Centralfunctions

Attarat PowerCompany

Enefit OutotecTechnology OÜ

Attarat PowerHolding Company BV

Enefit Power and HeatValka SIA

Energy sales

Irupower plant

Renewable energyand CHPEAO Real Estate Corp

EAO Federal Lease LLC

EAO State Leases LLC

EAO Technology LLC

EAO Orion LLC

Eesti EnergiaTestimiskeskus OÜ

Eesti EnergiaHoolduskeskus OÜ

Owned 100% by Eesti Energia AS

Eesti Energia departments

Owned 100% by Eesti Energia AS subsidiary

Eesti Energia with controlling interest

Minority interests

Enefit Jordan B.V

Attarat Mining Company BV

Attarat Operation and Maintenance

Company BV

Pogi OÜ

Eesti Energia Tabasalu Koostootmisjaam OÜ Orica Eesti OÜ

Narva Soojusvõrk AS

Enefit American Oil Co.

Eesti EnergiaÕlitööstus AS

Elektrilevi OÜ

Eesti EnergiaKaevandused AS

Eesti EnergiaNarva Elektrijaamad AS

Eesti Energia’Tehnoloogiatööstus AS

Enefit US LLC

Enefit SIA(Latvia)

Enefit UAB(Lithuania)

Eesti Energia AulepaTuuleelektrijaam OÜ

Attarat Holding OÜ

Jordan Oil ShaleEnergy Company

LEGAL STRUCTURE

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Principles Our principles of social responsibility can be described

on two levels. The first level combines our values and

code of ethics, the second level focuses on processes,

i.e. the management and operations of the organisation.

Corporate core values are the agreed principles we base

our daily work-related decisions. These principles support

our investment-related decisions but also any decisions

we have to make in our work.

Eesti Energias’ Code of Ethics is a set of rules of profes-

sional conduct. We expect all our employees, members

of Management and Supervisory Board and co-operation

partners to follow the principles of Code of Ethics.

We believe that by following the principles of Code of

Ethics we increase the value of the Group while ignoring

such principles we may damage the Group’s reputation.

Eesti Energia’s Code of Ethics reflects the vision, values

and best practice of Eesti Energia.

1. We will be honest and reliable and agree only with

legally binding agreements and transactions.

2. We will use the assets prudently and economically.

3. We will treat everyone with courtesy, respect and

consideration.

4. We will avoid from relations with public, customers,

partners, competitors and colleagues that is or will

bias our neutrality.

5. We will not compete with the employer nor damage

the interests of employer with our private business

interests.

6. We will follow Code of Ethics in our daily work.

We updated the sponsorship principles in 2015 including

classification of areas Eesti Energia supports, identification

of selection criteria of support projects, description of

sponsorship procedure and regulation of work procedure

of sponsorship committee.

Eesti Energia’s Code of Ethics reflects the vision, values and best practice of Eesti Energia.

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USEFUL TO CUSTOMERSWe can only enjoysuccess if we createcustomer value.

ADDING VALUEAbove all, we focus on the activities that create maximum value.

MAKING IT EASYWe take something complicated and make it easy and clear.

SAFETY ABOVE ALLOur operations have alwaysbeen associated with risks tothe environment and personalhealth, so we always upholdoccupational safety, healthand the environment.

IT DEPENDS ON MEMy energy, will andresponsibility ensure ourcommon goals are achieved.

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Eesti Energia strives to keep the organisational structure

of simple and, in managing the company, give priority to

the Group’s goals and needs. To make sure that mana-

gement is as effective and efficient as possible, we make

a distinction between the management structure and the

legal one. The governing bodies of Eesti Energia are the

General Meeting, the Supervisory Board, the Management

Board and the Audit Committee.

General Meeting

The General Meeting is Eesti Energia’s highest governing

body, which decides, among other things, the establish-

ment and acquisition of new and the liquidation of existing

companies, the appointment and removal of the mem-

bers of the Supervisory Board, major investments, the

appointment of the auditor, the approval of the results

for the financial year.

Eesti Energia’s sole shareholder is the Republic of

Estonia that is represented at the General Meeting by the

Minister of Finance.

Supervisory Board

Eesti Energia’s Supervisory Board is a governing body

that plans the Group’s activities, organises the Group’s

management and supervises the activities of the Mana-

gement Board.

Eesti Energia’s Supervisory Board has eight members

who are appointed by the resolution of the Minister of

Finance who represents the sole shareholder. Half of the

members of the Supervisory Board are appointed by the

Minister of Finance based on the proposal of the Minister

of Economic Affairs and Infrastructure.

The members of Eesti Energia’s Supervisory Board have

to meet the requirements and expectations set forth in

the Commercial Code and the special requirements set

forth in the State Assets Act. In addition, in conducting its

activities, the Supervisory Board is guided by the Articles

of Association of Eesti Energia AS and the rules of proce-

dure approved by the sole shareholder.

The primary functions of the Supervisory Board include:

• respresenting, and supervising the implementation of,

the strategy approved by the sole shareholder,

• planning the activities of Eesti Energia, adopting the

Group’s major strategic decisions, organising the com-

pany’s management, supervising the activities of the

Management Board and communicating the results

of the supervision to the sole shareholder.

Organisational Structure

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ERKKI RAASUKE Chairman of the Supervisory Board

VÄINO KALDOJA Member of the Supervisory Board

VEIKO TALIMember of the Supervisory Board

MEELIS VIRKEBAUMember of the Supervisory Board

ANTS PAULSMember of the Supervisory Board

DANEL TUUSIS Member of the Supervisory Board

RANNAR VASSILJEV Member of the Supervisory Board

MÄRT VOOGLAID Member of the Supervisory Board

SUPERVISORY BOARD

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The Supervisory Board is headed by the Chairman of the

Supervisory Board. In 2015, the composition of Eesti

Energia’s Supervisory Board changed. In September, the

shareholder removed Kalle Palling and Toomas Luman

from the Supervisory Board and appointed Väino Kaldoja

as a new member of the Supervisory Board. In Octo-

ber, Ants Pauls and Veiko Tali were appointed as new

members of the Supervisory Board and Randel Länts

was removed from the Supervisory Board. In December,

Peep Siitam was removed from the Supervisory Board

and Rannar Vassiljev was appointed as a new member

of the Supervisory Board.

At the end of 2015, the Supervisory Board of Eesti Ener-

gia comprised Chairman of the Supervisory Board Erkki

Raasuke and members of the Supervisory Board Meelis

Virkebau, Danel Tuusis, Märt Vooglaid, Rannar Vassiljev,

Väino Kaldoja, Ants Pauls and Veiko Tali.

As a rule, the Supervisory Board meets once a month,

except during the summer season.

Overview of the members of Supervisory Board, their

rights and obligations, attendance in Supervisory Board

meetings, remuneration and decisions approved during

the financial year are presented in the Annual Report

2015 and at the website of Eesti Energia.

Members of the Supervisory Board of Eesti Energia have

to meet the requirements and expectations set forth in

the Commercial Code and the special requirements set

out in the State Assets Act.

Supervisory Boards of Subsidiaries and Associates

The powers and responsibilities of the members of the

Supervisory Boards of Eesti Energia’s subsidiaries and

associates are determined by their Articles of Association.

Their Supervisory Boards are generally comprised of the

members of Eesti Energia’s Management Board.

Management Board

Executive management is the responsibility of Eesti

Energia’s Management Board. The Chairman of the Mana-

gement Board, who also performs the functions of the

Chief Executive Officer, is separately appointed by the

Supervisory Board.

In 2015, the composition of Eesti Energia’s Management

Board changed. In February, Margus Rink was removed

from the Management Board and the company’s Chief

Financial Officer Andri Avila was appointed as a new mem-

ber of the Management Board. At the end of 2015, the

Management Board of Eesti Energia comprised Chairman

of the Management Board Hando Sutter and the mem-

bers of the Management Board Andri Avila, Raine Pajo,

Margus Vals and Andres Vainola.

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MANAGEMENT BOARD

HANDO SUTTER Chairman of the Management Board

ANDRI AVILA Member of the Management Board

RAINE PAJOMember of the Management Board

MARGUS VALSMember of the Management Board

ANDRES VAINOLAMember of the Management Board

MARGUS RINK Member of the Management Board until 28 February 2015

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Management Principles

The Group’s management principles and policies were

reviewed and approved in November 2015. In 2016 these

principles and policies will be implemented. Eesti Energia’s

management is determined by the owner’s expectations,

the Group’s vision, agreed strategic objectives and values,

and the documents that regulate the activities of the

Group and all its entities.

Motivated employees are the key to Eesti Energia’s

success since their dedication helps to create value to

customers and fulfil the owner’s expectation. The emp-

loyees of Eesti Energia are united by their desire for doing

work that matters.

Our employees regard our core values highly: useful to

customers, adding value, making it easy, it depends on

me and safety above all.

The management of Eesti Energia assures that the emp-

loyees:

• know the company’s strategic goals and believe in

achieving the set aims,

• know what is expected from them and do their best

in areas of their competency.

Eesti Energia retains the employee motivation by recog-

nising and developing their strengths. The management

level considers it very important that each team member

is doing work the employee is very good at. The Group

has implemented a results-based goal setting system

covering all processes and management levels therefore

reaching at each and every employee. We have set result

indicators to all critical success factors.

The managers of all levels are conducting regular four-eye

conversations with their direct subordinates. We believe

that the open two-way communication is a key to achie-

vement of corporate goals. All Group leaders play key

role in following the principles of people management.

Owner’s Expectations

The owner’s expectations are the set of principles that the

Supervisory Board and the Management Board have to

observe in designing the company’s strategy and action

plan and the company’s strategic objectives and financial

targets. The owner’s expectations were rewieved by the

minister of Finance in December 2015.

The owner’s strategic expectations of the company are

as follows:

• to maintain a significant market share in the regional

electricity market,

• to reduce CO2 emissions in power production,

• to develop oil production and other ways of adding

value to oil shale,

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We regard measuring social responsibility as a requirement for our business activity and an essential principle for decision-making.

• to reinforce international recognition of Estonia’s com-

petence in matters pertaining to the oil shale energy

industry,

• to improve the quality of the distribution network

service,

• to minimise the environmental impacts of the

company’s operations.

Central Functions

The following functions that support achievement of

the Group’s business objectives have been centralised

and operate Group-wide: finances, human resources

and internal audit, communication and marketing, IT,

environment safety, administration, procurement and

legal counselling.

Differences Applying to Management of the Distri- bution Network Operator

Under the Electricity Market Act, Elektrilevi as the dist-

ribution network operator has to ensure, among other

things, that all market participants are treated equitably

and that the information obtained by the network ope-

rator is protected.

The Group has adopted rules for handling confidential

information in order to ensure that all market participants

are treated equitably.

In accordance with legislation and best practices, Eesti

Energia has also put in place differences applying to the

management of Elektrilevi, which ensure the network

operator’s independence in adopting investment deci-

sions, conducting procurements and maintaining the

confidentiality of information pertaining to market par-

ticipants and customer contracts. The Supervisory Board

of Elektrilevi is entitled to approve the company’s annual

financing plan and debt ceiling.

Agreed Reporting Principles

Quality management decisions are underpinned by accu-

rate and timely information. It is essential that reporting

should be both factual and forward-looking. This allows

using the best knowledge to prevent risks from realising

and turn them into competitive advantages.

Management reporting is mainly used internally within

the Group. We distinguish between the performance-

based reporting focusing on the company results, and

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project-based reporting, which analyses on implemen-

tation of investments and development.

Reporting improvement is constant. The indicators impac-

ting the achievement of set goals are reviewed.

Effective Supervision

Eesti Energia Group has implemented a multi-level and

balanced chain of supervision, which is focused on the

most critical risks. The risks determine what needs to be

done to be able to adjust one’s activities and help the

Group best achieve its objectives.

Audit Committee

Eesti Energia’s Supervisory Board has set up an Audit

Committee and has assigned the Audit Committee

rights and responsibilities in accordance with the approved

rules of procedure. In its work, the Audit Committee is

mainly guided by the statute of the Audit Committee and

the Auditors Activities Act. The primary function of the

Committee is to advise the Supervisory Board in super-

vision-related matters.

The work procedures of Audit Committee are descri-

bed in more detail in the Annual Report 2015 and Eesti

Energia website.

Internal Audit

The Group’s internal audit function has been organised

and carries out its responsibilities in accordance with

the International Professional Practices Framework that

sets out international standards for internal auditing. The

work of the internal audit function covers the activities

of the whole Group.

Ensuring effective operation of the internal audit function

is the responsibility of the Internal Audit Department. The

Department is accountable to the Audit Committee and

the Supervisory Board and its plans and reports are also

evaluated and approved by the Audit Committee. The

role of the Internal Audit Department is to contribute to

improving Corporate Governance and Risk Management

the internal control environment, risk management, and

business management culture.

The Group has established a system for disclosing eco-

nomic interests by which employees who may have conf-

licts of interest in fulfilling their responsibilities disclose

their economic interests and confirm their independence

through regular self-assessment.

Handling of inside information is regulated by Eesti Ener-

gia’s inside information handling rules because the Group

has issued Eurobonds listed on the London Stock Exc-

hange. Proper handling of inside information is essential

for protecting the interests of bondholders and ensuring

fair and orderly trade of the bonds.

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RISK MANAGEMENT FRAMEWORK

RISKMANAGEMENTGOVERNANCE

GOALS

Linkingwith the

managementsystem

RISKHANDLING

RISKASSESSMENT

Com

mun

icat

ion

Com

municationInforming

about risksPreparingthe riskprofile

Creatinga shared

understandingof risks

Makinginformeddecisions

about risks

Riskmanagement

Respondingto events

Riskanalysis

Gatheringdata

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The risks and risk appetite can be divided into four broad categories

Risk ManagementThe primary goal of the Group’s risk management is to

ensure that the Group does not take on or assume more

unhedged risks than it can carry in the process of meeting

its objectives.

Governance of Risk Management

The Group’s risk management is coordinated by the

Risk Management Department, which is responsible for

developing, implementing and maintaining the process

required for managing all significant risks influencing the

operation and performance of Eesti Energia.

Each Group company and business unit has to ensure,

in consideration of its goals and targets, that its risks are

managed. Moreover, it must be certain that when a risk

realises the company or business unit can continue carrying

out its designated operations in a sustainable manner.

Risk Assessment and Management

In each category, the Group has developed risk manage-

ment strategies, implemented a risk quantification and

reporting system, and determined the parties responsible

for managing the risks within the Group.

Risk Reporting

Significant risks that may affect the achievement of

the Group’s goals and targets are regularly reported to

the Group’s Management Board and Audit Committee.

The Group makes sure that the Management Board is

promptly notified of all significant risks and that such risks

are included in the Group’s risk profile.

STRATEGICRISKS

The Group takes well-considered risks toincrease revenue.

MARKETRISKS

The Group controls the risks and keepsthem as low as possible because they arean inherent part of its business operations.However, taking the risks does not resultin additional revenue or is not the Group’score activity.

FINANCIALRISKS

OPERATIO-NAL RISKS

ENVIRONMENTAL RISKS

The Group is notprepared to takethese risks becausedoing so wouldjeopardise the environment, the health of the public and its employees, and its reputation.

HEALTH ANDSAFETY RISKS

The Group controls the risks and keepsthem as low as possible because they arean inherent part of its business operations.

are the spine of oil shale industry

Engineers

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EESTI ENERGIA AS AN EMPLOYER

As at 31 December 2015 Eesti Energia employed

approximately 6,000 employees, down year-on-year

due to increased work efficiency, declining volumes and

volatile market situation.

Commitment and Job Satisfaction Survey We conduct employee commitment and job satisfaction

survey every second year to have a better understanding

of employee motivation, collect feedback and identify key

factors impacting such commitment. The survey results

are used as input to employee related management deci-

sions, business planning and goal measurement.

The last such survey taken in autumn 2014 indicated that

we need work more with management level employees to

ensure a smoother information flow to other employee

levels. The survey also indicated that we need to work

harder with communication with our international opera-

tions. Direct feedback from managers is one of the most

important subjects besides general change management

and internal communication. Many employees indicated

that they miss direct regular feedback from managers

that would help to improve their results and improve

their career opportunities.

In 2015 we started to work with action plans of how to

maintain and improve the employee satisfaction. We

have also launched several training programs to solve

the core problems indicated in the survey.

Virumaa

Central Estonia

South Estonia

International: Latvia, Lithuania, Germany, Jordan, USA

Tallinn and Harju region

1%

17%75%

2%

5%

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20

35

9

22

46

18

21

11

Employee Profile (%) Length of Service (%)

Employee Age (%) Split of Female and Male Employees (%)

Managers

Specialists

Skilled workers

less than 1 year

1–10 years

11–20 years

21–30 years

31–40 years

41–50 years

20–30 years

31–40 years

41–50 years

51–60 years

61 or more

Female

Male

55

29

13 20

80

8

21

28

Average length at service 14.74 y

Average employee age

45.33 y

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Narva power plants launched a feedback system the

aim of which is to collect employee feedback on work

processes and environment, general atmosphere or

other important matters. The system imitates a feedback

system Oil industry successfully introduced already in

2013. In autumn 2015 a consulting partner was cho-

sen to conduct a new survey and analyse the improve-

ment made on previously identified development needs.

EmployeeImprovementProject Management Improvement

In 2015 we launched an extensive development program

for project managers. A total of 85 project managers

passed the full program in two groups – the managers of

giant projects (minimum project value of 600,000 euros)

and the managers of large-scale projects. The program

was divided into three modules – project management,

people management and self-management.

In 2015 we analysed the impact of the improvement

program on the quality of project management and

continued to share internal experiences in the project

management workshop format. In the fourth quarter

harmonized principles were introduced that will be the

basis for initiating and managing all projects in the group.

The harmonized principles should ensure that all projects

would be professionally managed and generate maximum

value for Eesti Energia. We also put together a project

management handbook that includes necessary support

materials for project managers.

In 2016 we will update the handbook by adding sections

on knowledge and skills to reflect the new project mana-

gement principles and focus significantly on growing new

project managers.

Management Improvement

In 2015 a number of training programs targeting mana-

gers took place: “Management key skills”, “Leadership in

Eesti Energia” and “Improvement by leadership”. The latter

was attended by close to 160 managerial level employees

of the Group.

To ensure one of our core values – safety above all – the management of all Group entities increased their safety knowledge in specific safety- focused training course.

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To ensure one of our core values – safety above – the

management of all Group entities increased their safety

knowledge in specific safety-focused training course. In

the leadership of Risk Management and Internal Audit

division anti-corruption trainings were launched in

December to increase the risk awareness of employees

and improve the ethical problem solving skills they may

encounter. We also started with media communication

trainings to improve the skills and knowledge of spokes-

persons of Eesti Energia in communicating messages

about the reputation and image of the organization.

In 2015 we started with mapping the internal trainers

of Eesti Energia and writing down the training program

principles. Our remarkable internal trainers have recei-

ved positive feedback also from outside the organization

– Estonian Internal Trainers Improvement Association

awarded Tõnis Tajur from Elektrilevi as the Internal Trai-

ner 2015.

Employee Improvement We introduced a new human resource management policy

in 2015, which states that employees should continuously

focus on personal and professional improvement. Emp-

loyee development and training in Eesti Energia is focused

and systematic and based on the goals of Eesti Energia.

Primary Training Areas

Share of total trainings

AREA 2013 2014 2015Engineering and production 39% 33% 35%

Organization and administration

25% 14% 12%

Leadership 12% 20% 18%

Environment protection and work environment

7% 7% 10%

Languages 6% 3% 8%

IT and computer studies 5% 13% 9%

Customer service 3% 5% 3%

Other (law, legislation, personal development)

2% 5% 5%

Average number of hours

SEGMENT 2013 2014 2015Management 20.8 10.2 36.6

Specialists 16.1 9.2 33

Others 9.6 23 9.6

Male 12.5 12.7 16

Female 14.7 8 20

Average Number of Training Hours per Employee Segment and Sex

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In 2015 Eesti Energia invested 113,000 hours and 1.1

million euros to employee improvement.

The male employees received 16 hours of training com-

pared to 20 hours for women.

Managerial level employees were trained on average

36.6 hours, specialists 33 hours and others 9.6 hours.

In 2015 we continued with implementing Eesti Energia’s

core values updated in 2013. We expanded the debate

format to the whole Group so that employees could draw

connection between the values and daily operations as

well as debate about the role of values in corporate

management.

Our Value Proposition to Our Employees Eesti Energia values its employees by:

• providing the employees work they know and love with

further improvement opportunities,

• fair remuneration considering their contribution to the

achievement of corporate goals,

• recognising the employees who have achieved or

exceeded the set goals.

Quite often the employer and employee relationship

continues after the employee has left Eesti Energia. Our

former employees who have contributed to the company

over a long time and are now retired have joined the

veteran clubs. In 2015 we continued to support the social

gatherings of such clubs and organised meetings with

management to share information about the company.

In 2015 we organised the following joint events: New

Year’s Party for employees, Energy Day and Narva Energy

Run, Miners Day for employees and their families and

the Ida-Virumaa region in general, Christmas Parties

for children of our employees of up to 13 years of age.

We recognised the best employees in the New Year’s

Party. Gold (5) and silver medals (37) were given out in

Quite often the employer and employee relationship conti-nues after the employee has left Eesti Energia. Our former employees who have contri-buted to the company over a long time and are now retired have joined the veteran clubs.

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four categories: lifetime achievement in Eesti Energia,

successful beginning, outstanding mentor and caring

colleague.

Engineering Solution of the Year was this time awarded to

EE Hoolduskeskus for upgrading the electrical appliance

of walking excavator in Narva opencast mine. Achievement

of the Year 2015 was awarded to increasing the share of

shale gas in the production of electricity in Eesti power

plant. The Management Board gave out a special award

to Eesti Energia’s bond refinancing team.

Employee commitment and job satisfaction survey

indicates that 80% of employees appreciate the bene-

fits offered by the company whereas such benefits are

somewhat more important for workers than for specia-

lists and leaders. The benefit package varies across the

Group companies but in addition to the above-mentioned

joint events the benefits include also days off or financial

support in case of important family events, celebrating the

work jubilee, subsidising sports clubs, additional vacation,

healthcare related services etc. .

Employment Termination

Year 2015 faced number of major redundancies in

Ida-Virumaa region that impacted also Eesti Energia Kae-

vandused. The redundancies were a result of instability

in oil market but also increased efficiency of production

process. We have set up a support fund to allow those

who have become redundant apply for entrepreneurship

or retraining scholarship.

Sports Clubs

Eesti Energia is running three sports clubs — the Eesti

Energia sports club and the sports clubs of Eesti Energia

Kaevandused and Narva power plants with close to 3,000

members. Approximately 2,700 of those are the emp-

loyees of Eesti Energia while the rest are family members.

Besides weekly trainings our employees are actively atten-

ding different recreational sports events as well as internal

and cross-firm competitions sponsored by sports clubs.

In 2015 the Group companies supported sports clubs

with ca 350,000 euros to promote recreational sports.

Employee commitment and job satisfaction survey indi- cates that 80% of employees appreciate the benefits offered by the company.

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Future Employees and Successors The future of oil shale industry is very much dependent

of people with engineering skills who can develop and

implement innovative solutions. The demand for young

workforce is also caused by the retirement of current

engineers in the coming 10 years. Therefore our focus is

primarily on a) increasing the attractiveness of engineering

among young people and b) introducing Eesti Energia

to students who have already enrolled in engineering

courses by offering practical hands-on approach together

with our employees.

Internship opportunities in Eesti Energia companies under

the guidance of our professional specialists have become

one of the most important activities in developing our

future employees. Internship opportunities are available

throughout the year but the interest is largest during

summer months. Our highest expectations are on engi-

neering (mining, construction and mechanics, electrical

engineering etc.) but every year we also have interns in

the headquarters of Eesti Energia. In 2015, we had 319

interns of whom 251 did their internship in our entities

in Ida-Virumaa region and 68 in Tallinn.

In addition to internship opportunities we support future

engineers through our scholarship programs. In 2015, we

provided scholarships to 5 engineering students of Ida-

Virumaa Vocational Education Centre and 6 geo-

technology students of Tallinn Technical University.

We have invited students to site visits to diversify the

study process and give them better practical overview

of the profession. In 2015 we hosted 64 study visits and

excursions to 1,464 pupils and students.

For the second year we continued with hosting “Wisdom

Quest” program in Aidu openpit mine. In 2015 the 9th

graders from Saue Gymnasium were lectured about oil

shale followed by canoeing on Aidu channel.

Eesti Energia, Viru Keemia Grupp and Eastman Speciali-

ties signed goodwill agreement with Jõhvi Gymnasium to

increase the interest of local youth in studying engineering

in Ida-Virumaa region. As part of goodwill agreement we

help to establish, implement and develop engineering rela-

ted selective courses as well as improve in-depth mathe-

matics and science courses. We also aim to increase the

awareness of job shadowing and internship possibilities.

“Strategic development of energy system” lecture course

in cooperation with energy faculty of Tallinn Technical Uni-

versity took place for the fifth time during 2015 autumn

semester. 15 top specialists of energy sector and Eesti

Energia including 3 experts from Finland focused on

challenges and development possibilities within energy

sector. The course that was open to all interested parties

was attended by close to 95 participants.

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In 2015 we sponsored 7 projects with total of 13,400

euros to promote engineering studies and develop future

engineers. The projects included writing of several engi-

neering textbooks, organizing science related recreational

activities at Oil Shale Competence Centre, organizing

conferences introducing engineering etc.

Development Program for Engineers

Engineering competency and future engineers play key

role in ensuring the sustainability of oil shale industry.

In 2015 we launched Insenergia, a youth development

program, the aim of which is to promote education in

engineering, target the most talented students in the

program and sponsor their further development. Stu-

dent teams solved real-life engineering technology

related tasks over the five-month long pilot program.

The program mentors were experts from Eesti Energia.

The program included several study visits to production

facilities and participation in internal trainings and events

of Eesti Energia. Additionally, the 14 carefully selected

participants received a scholarship from Eesti Energia. The

participants appreciated Insenergia program highly inclu-

ding the opportunity to complement theory with practical

cases. Additionally, the participants mentioned that due to

the program they know now more about Ida-Virumaa, a

region where most of Eesti Energia’s production is taking

place. The program also increased the courage of the

participants to initiate and develop the ideas that may

have seemed impossible in the first place. The program

allows the participants also see how a large corporation

functions. Many of the participants decided to join us for

internship after the program. We will continue with the

program also in 2016.

Safety of Work Environment One of the core values of Eesti Energia is safety above

all. Many of Eesti Energia’s employees are exposed to

physical, physiological and psychological hazards, and

work under difficult conditions and/or outdoors. In 2015

we focused even more on work safety.

We established a Board for Work Safety that is run by the

member of the Management Board of Eesti Energia res-

ponsible for production and that includes working environ-

ment specialists of different Group entities. The Board for

Work Safety analyses the crucial working environment and

safety problems and the causes for job accidents. It is also

an organization for exchanging related experiences. The

aim of the Board is to improve the cooperation between

Group companies in advancing safety culture.

In order to achieve the set aim we defined 12 safety rules

in 2015. The safety rules were based on the analysis of

job accidents and dangerous situations encountered in

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our work. Therefore it is particularly vital to follow such

rules for avoidance of accidents. In 2015 we completed

and took into use training movies presenting potential

dangers employees may encounter in Estonia mine, Narva

openpit mine and logistics.

Occupational health and safety trainings take place

regularly to train employees in preventing work related

risks, analysing such risks and finding the best technical

and economical solutions in dealing with these risks. We

conduct regular risk awareness checks to control and

fix the work safety related knowledge. Additionally, we

introduced a quarterly work safety day that is attended

also by Group management. All jobs have passed work

environment and safety risk analysis.

All new employees (including those working in office)

pass work safety training once employed. In spring 2015

fire safety trainings were organized for the employees of

Eesti Energia AS headquarters. Similar trainings will be

organized in other Group entities in the near future. In

autumn 2015 work safety training was arranged for the

top management of the Group followed by an exam to

pass the course.

All production entities of Eesti Energia have implemented

OHSAS-18001 standard “Control systems of occupational

health and safety”. The principles and requirements are

the basis for designing the occupational environment

and work safety.

12 Safety Rules of Eesti Energia

We advise our co-operation partners of the ethical, fire

and occupational safety requirements of our company,

and expect the employees of our contractual partners

working on our site to comply with these requirements.

Oil shale power plant supports generation

of renewable energy from low-value timber and logging residue

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Building customer satisfaction and improving service and

product quality play key role in maintaining customer

relations. In 2015 our focus was on providing quotes

that meet customer needs, introducing straight-forward

packages and pricing principles as well increasing price

competitiveness. Additionally, we also focused on more

efficient solving of corporate customer billing related

problems and increasing service quality.

In 2015 our focus on customer relations was on following

key aspects:

• customer-focused consulting and providing quotes

meeting customer needs,

• more straight-forward and clear packages and pricing

strategy,

• solving corporate customer billing issues.

The most outstanding improvements in 2015 include

the collection of more accurate power consumption data

(increase in data received via remote reading system) and

better consumption reporting behaviour. Additionally, the

reorganisation arising from market changes has brought

advisory into spotlight of our service model. The sum of

these improvements has awarded us with an extraordinary

result: in 2015 the customer satisfaction indicators were

the best of last six years.

To achieve the year 2015 goals:

• we simplified the process of changing the service

provider,

• we continued to improve the e-service environment,

• we continued to improve the process of prolonging

the electricity contracts,

• we developed a personal service model for business

customers,

CUSTOMER RELATIONS

In 2015 our focus was on providing quotes that meet customer needs, introducing straight-forward packages and pricing principles as well increa-sing price competitiveness.

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• we solved billing related customer inquiries faster and

more efficiently,

• we developed customers value propositions,

• we simplified service process,

• we developed customer-focused advisory services in

manned service channels,

• we launched a mobile app.

Customer Satisfaction Highest in Six Years The annual customer satisfaction survey conducted

annually together with TNS Emor, is used to make business

decisions, prepare action plans and measure set goals.

Survey results in 2015 were the best for the last six years!

According to TNS Emor the three-point increase in the

results is remarkable. Feedback from household custo-

mers has improved in almost all key areas of customer

relations. With these results the average benchmark of

the European energy companies has become too low

and we can rather benchmark ourselves with TOP 33%

of European energy companies that requires a minimum

of 62-point TRI*M index.

The latest survey indicates that also our corporate cus-

tomers are more satisfied and their feedback has either

improved or stayed at the same level as a year ago in

all key areas of customer relations. Personal approach

by our customer relationship managers is highly valued.

Additionally, we received improved feedback on the cus-

tomer relationship managers’ initiative, problem solving

speed and sector knowledge. Feedback was very good

also on pricing transparency, understanding and ability

to solve billing related issues.

Customer Relationship Index (Tri*M)

2010 2011 2012 2013 2014 2015Household customer relationship (or Tri*M) index 49 31 45 42 61 64

Corporate customer relationship (or Tri*M) index 39 29 36 38 53 57

Large corporate customer relationship (or Tri*M) index 39 49 50 42 64 66

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number and content of customer inquiries for analysing

purposes. We train our employees for the sake of quality,

efficient and professional services.

Getting Ready for Launching Professional Counselling Centre

In 2015 we made preparations for launching a full service

solution counselling centre in 2016 to replace the existing

call centre, e-mail service group and service centres.

According to our service standard 70–80% of calls should

be answered within 25 seconds. In 2015 we met this stan-

dard in 74% for customer service line and 75% for fault

notification line. We launched a callback service in February

to make the work of call service centre more efficient.

The service allows customers to choose a callback rather

than wait in the waiting list. We also paid more attention to

efficient post counselling service to ensure the customer

has received answers to all outstanding questions.

While in 2014 we received inquiries on electricity cont-

racts and network services from 115,451 customers then

in 2015 the number dropped to 98,211. Such a drama-

tic drop has been achieved primarily due to increased

process efficiency and more personal response letters.

Customers consider the following as our strength:

• efficient administration and friendly service,

• efficient contracting and contract renewal process,

• simple and understandable products,

• accurate billing,

• customer specific consulting and professional

approach in solving issues.

Customer Services in Accordance to Service Standards We ensure high service quality by implementing Eesti

Energia service standards, which are based on the cus-

tomer expectations and the specifics of our business. We

have set goals to assess the service quality and efficiency

in service channels that allow us to measure the content-

ment of customers with the competence of customer

service and suitability of suggested solutions.

As we sell electricity to more than 560,000 consumption

points we have to be ready to handle thousands of inqui-

ries each day. Therefore, we are constantly following the

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Customer inquiries are also solved over phone. However,

e-mails are still preferred due to speed and convenience.

We are targeting to respond 80% of e-mails within 24

hours and 99% within 72 hours to ensure the quality of

e-mail service. The average monthly results from 2015

indicate that we have reached almost the maximum result

of this standard – 75% of e-mails were responded within

24 hours and 99% within 72 hours.

Customer Assessment of our Customer Hotline Number in 5 Point Rating Scale*

5

4

3

2

1

04.0

20114.4

20144.4

20154.2

20124.3

2013

*Assessment is based on Eesti Energia’s monthly feedback survey from customers who had contacted us in previous month

Number of Calls to and Level of Service of Eesti Energia’s Customer Hotline Number 1545*

Total number of calls Level of service (%)

100%

80%

60%

40%

20%

0%

50,000

40,000

30,000

20,000

10,000

0Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.

*Includes inquiries about network service of Elektrilevi.

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We have implemented a work schedule allocation, which

allows us to have optimum number of employees available

for faster e-mail service at busier times.

Since customers prefer e-service or customer hotline

numbers that are faster and more convenient service

channels, certain changes took place in the office network

in 2015. The decrease in number of visits by customers

is also caused by transition to remotely read meters and

therefore customers no longer need to visit sales offices

to report the recent power consumption. Therefore the

customers of Eesti Energia are serviced by e-mail and

Assessment of teenindus@energia.ee in 5 Point Rating Scale*

5

4

3

2

1

03.9

20114.3

20144.4

20154.0

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2013

*Assessment is based on Eesti Energia’s monthly feedback survey from customers who had contacted us in previous month.

E-mails Sent to and Level of Service of teenindus@energia.ee*

*Includes inquiries about network service of Elektrilevi.

100%

80%

60%

40%

20%

0%Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.

Number of e-mails 72 h level of service (%)

10,000

8,000

6,000

4,000

2,000

0

24 h level of service (%)

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S hotline number. The customers of Elektrilevi can still look

for assistance in service centres in Tallinn, Tartu, Jõhvi and

Pärnu. In other regions the customers of Elektrilevi may

receive counselling from regional specialists. The number

of visits to request information about electricity contracts

and network service dropped from 136,033 in 2014 to

57,453 in 2015 indicating that customers continue to

prefer e-channels and hotline number.

Answers from E-service

Eesti Energia’s e-service is our most popular service

channel used by every second customer.

Eesti Energia’s e-service channels are operational 24

hours allowing customers to sign electricity contracts,

review electricity price at the place of consumption,

change electricity packages, report electricity consump-

tion, view invoices received, sign authorisations, analyse

consumption or fill in energy profile any time. The cus-

tomers can also see targeted offers through e-service

channel and if interested read about Eesti Energia.

Mobile App to Make Life Easier

Besides website and counselling centre the customers

can also choose Eesti Energia’s mobile app for electricity

related questions. By the end of 2015 the mobile app had

24,761 users. The app allows monitoring and managing

daily electricity consumption, get information about mar-

ket prices and view details about electricity contract such

as length, packages and prices. Those customers who do

not yet have remote reading system can also use the app

for reporting electricity consumption. Since 2015 the

app incudes a feature for viewing and paying electricity

bills and compare the data with previous months. Each

users can also see the partner offers and find customer

service contacts.

Customer Satisfaction with Sale Offices in 5 Point Rating Scale*

5

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2

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*Assessment is based on Eesti Energia’s monthly feedback survey from customers who had contacted us in previous month.

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Products Meeting the Demands of Each Customer

Our primary goal with product offers is to provide the

needs-based solutions for each customer. Third year of

operations in open electricity market assured us that our

customers still prefer simple products that help them in

protecting against electricity exchange price fluctuations.

Eesti Energia’s electricity product packages are based on

three easy choices: fixed price product package, exchange

price based variable price product package and combined

price product package of 50% of fixed and 50% of variable

price. Among these packages the customer may decide

on the term of the contract and whether the price rate will

be the same for 24 hours or separate for day and night

(dual-tariff price).

To help keeping energy costs under control Eesti Energia

upgraded its mobile app in 2015 by adding payment fea-

ture and notification of consumption, fluctuations in energy

prices and payment deadlines. Eesti Energia’s corporate

customers can also purchase gas together with electricity.

Information about product news is available in e-service

channel, newsletters and market overviews.

Customer Satisfaction with E-service in 5 Point Rating Scale*

*Assessment is based on Eesti Energia’s monthly feedback survey from customers who had contacted us in previous month.** Since we started signing electricity contracts only in November the 2012 results indicate the average for November and December.

5

4

3

2

1

04.5 / 3.9

2012**4.1 / 4.1

20133.9 / 4.2

20144.2 / 4.2

2015

Signing electricity contracts in self-service, channel

Signing electricity contracts in self-service, process

Number of Customers of E-service

400,000

300,000

200,000

100,000

001 02 03 04 05 06 07 08 09 10 11 12

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More than 70% of Customers Prefer Fixed Electricity Prices

Eesti Energia aims to advise customers on choosing the

best product and offers its customers simple and trans-

parent electricity prices. That is also a reason why each of

our customers can check from e-service channel, which

electricity price package meets the customer’s needs

the best. To see the price overview of the point of con-

sumption customer has to login to e-service channel. The

customer may sign new contract or replace the current

electricity supplier for no extra costs.

Automatic Extension of Electricity Contracts

As an option we offer our customers the automatic exten-

sion of existing electricity contracts. Before the end of

existing contract term we send the customer an offer for

the next contract period. If the offer is acceptable the

contract is automatically extended without any interven-

tion by the customer. In 2015 approximately 98% of our

customers decided to extend the contracts automatically.

Prices Based on Personal Consumption of Each Customer

Like in previous years customer electricity consumption

was the key factor in pricing the electricity product pac-

kages also in 2015. Therefore we are always recommen-

ding our customers to consider consumption based price

offers in our e-service channel besides public price lists

and general information published in different portals. In

order to see the consumption based price offers customer

needs to login to e-service channel.

Third year of operations in open electricity market assured us that our customers still prefer simple products that help them in protecting against electricity exchange price fluctuations.

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Smarter Consumption

In 2015, 17,000 unique users visited energy saving web-

site of Eesti Energia at energia.ee/kokkuhoid. Our energy

saving website is the most practical tool to analyse the

usage of electricity, water and heat and the expenses

by all energy types. By the end of 2015, approximately

1,400 customers had filled in their energy profile in our

e-service channel. In addition to energy profile those

interested in energy saving can also find other saving

possibilities such as 3D-home models, recommendations,

tips and energy saving blog.

Throughout 2015 Eesti Energia devoted a lot of time in

spreading the conscious consumption mind-set. Part of

the project was also energy saving video contest to find

Consumption of Green Energy (GWh)

80

60

40

20

0

38.82011

42.1 2014

78.1 2015

50.92012

37.92013

GWh

Popularity of Green Energy Growing

On market opening the customers had a critical view

on their electricity prices and many customers gave up

Green Energy due to growing costs. Today, when the

customers have gotten used to electricity market prices,

the interest in buying renewable energy is increasing. In

addition to higher sales volume of renewable energy in

2015 it is worth noting that many Green Energy custo-

mers have remained faithful to environmental friendly

energy since it was first introduced. As at the end of

2015 Green Energy was sold to 2,192 household cus-

tomers and 170 corporate customers. In 2015, total

consumption of Green Energy in Estonia amounted to

78.1 GWh of renewable energy.

Number of Customers who have Filled in Energy Profile

20,000

16,000

12,000

8,000

4,000

0

4,6002011

14,300 2014

15,700 2015

8,0002012

13,0002013

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To prevent situations where the customer’s mailbox is full

and our notification letters will not be received, we conti-

nued in 2015 with implementing agreed work procedures.

We used the procedures to review each returned e-mail,

ascertain the reason for this return and used alternative

channels to reach the customer.

Solving Billing Related Issues

In 2015 we prepared some 530,000 invoices each month

of which 99.8% were delivered without any problems.

We continued with solving billing related issues such by

improving data management and IT solutions. If needed

we offered free payment schedule to customers who have

faced the billing related issues over a long time period.

To make things easier we upgraded our mobile app with

payment feature and consumption history and invoice

balance feature. Additionally, all users can subscribe

invoice and payment term notification.

smarter energy saving and consumption tips. We recei-

ved 23 videos that received more than 100,000 views

on Facebook. The thorough message was – turn off the

lights and plug off the electrical equipment if not used.

Adding Value with Partner Offers

We continued with partner offers to our customers e.g.

our customers could attend Narva Energy Run in summer

for reduced fee and visit Energy Discovery Centre until

the year-end for discounted price. We provide a variety

of interesting partner offers to our household customers

a year round.

We also launched a campaign targeting household cus-

tomers the prize of which, drawn at the end of year, was

full year of free electricity to 50 household customers

Customer Notification

We consider principle of simplicity when notifying our

customers of upcoming changes. Our messages have to

be equally understandable to all customers. Notification

letters are sent in Estonian or Russian, a language pre-

ferred by customer. We use e-mail, regular mail, electro-

nic newsletter, market overview, text message, message

through e-service channel, cover letter to invoice and

first page of invoice as notification channels.

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Debt Management

In case of customer’s temporary solvency problems we

have, in general, come up with a solution satisfying both

parties. Therefore, we encourage our customers to inform

us of potential insolvency problems before the payment

term. If possible we try to find the best possible solution,

offer payment schedule or short-term payment grace

period.

In 2015, we took a step forward in debt settlement

process by channelling less complicated issues directly

to service channels. This was done to ensure rapid solution

to customers with excellent payment behaviour already

on their first inquiry without having to wait due to debt

management routines. Since the change took place the

debt management team is focusing on daily management

of debt portfolio, preventing more complicated problems

and handling serious payment issues.

Customer Complaints

Our ultimate goal is to reach zero customer complaints.

However, until this has not been reached the complaints

have to be handled. Customer complaints are solved in

the same database as customer inquiries not fully solved

during the first contact. While in 2014 the second level

customer inquiries (incl. complaints) amounted to 807

then in 2015 the number had increased to 3,901. The

dramatic increase was caused by change in work process

Customer Satisfaction with Billing in 5 Point Rating Scale

Employee appraisal

4.1 / 3.92011

4.2 / 4.12012

4.2 / 4.0 2013

4.6 / 4.32014

4.6 / 4.22015

5

4

3

2

1

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Processes appraisal

Customer Satisfaction with Debt Settlement in 5 Point Rating Scale

Employee appraisal

4.2 / 4.02011

4.3 / 4.12012

4.3 / 4.2 2013

4.3 / 4.32014

4.3 / 4.32015

5

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when we started providing all follow-up services using

single database. Daily reports allow us to distribute the

tasks between responsible people so that all customer

inquiries are handled instantly. As a result we responded

100% of customer inquiries on time in 2015.

Protection of Customer Data

We keep customer data complete, up-to-date and accu-

rate. “Principles of customer data processing in Eesti

Energia AS Group” approved by the Management Board

ensures the protection of customer data.

Elektrilevi Focuses on Reliable Network Service The key role of Elektrilevi, the distribution network ope-

rator of the Group, is to ensure the quality of distribution

network service and efficient customer service.

In 2015, Elektrilevi invested 93 million in network service

improvement. On average we built five kilometres of

transmission lines and one new substation a day. However,

a more stormy weather that increased wind generation by

close to 20% had negative impact on the level of network

reliability. Last year total reconstruction of distribution

network amounted to 1,773 kilometres while number

of breakdowns increased 8% to 19,593 leaving the cus-

tomers of Elektrilevi without electricity supply for 187

minutes on average. Last year around 290,000 house-

holds and enterprises did not have a single breakdown.

Growing weatherproof power network reduces successfully

the possibility and length of power cuts. Elektrilevi aims to

upgrade the power network so that 90 percent of custo-

mers would be connected to weatherproof power network

by 2025. Over the last five years Elektrilevi has invested

472 million euros while breakdowns have dropped close

to 33% indicating that Elektrilevi has followed reasonable

investment policy and channelled the funds wisely.

Customer Complaints

2012 2013 2014 2015Number of customer complaints on second level

3,105 1,717 807 3,901

Time spent to solve inquiries (in days)

8 5 4 2

Timeliness of solved inquiries

88 94 99 100

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In 2015, we continued with extensive installation of

remote meter reading systems. By the end of the year

498,000 readers had been replaced. Transition to remote

meter reader system will be completed by December

2016. The new meters save the customers from reporting

their consumption and allow saving money by controlling

their consumption and electricity package

In the second half of the year Elektrilevi and Türi Voluntary

Firefighters Union signed a cooperation agreement for

faster liquidation of storm caused damages. The agree-

ment is in line with the company’s goal of increasing the

awareness of electric safety. As part of the cooperation

agreement Elektrilevi gave Türi Voluntary Firefighters

Union a free Isuzu D-max jeep and organised electric

safety training. The jeep, formerly used by Elektrilevi’s

breakdown team, will now be mostly used by Oisu brigade

of Türi Voluntary Firefighters Union for equipment trans-

portation, fighting forest and wildland fires, human search

and removing storm broken trees from roads and building.

On need bases the jeep is used all over Järvamaa region

but it is meant for Türi, Väätsa and Imavere parishes.

Following the purpose of Elektrilevi’s safety campaign we

increased the share of practical communication. During

the electric safety campaign in 2015 the employees of

Elektrilevi and Electro Rabbit (a mascot) trained close to

6,000 children and their parents to notice electric hazards.

Elektrilevi and Estonian Rescue Board arranged 14 safety

camps to students of elementary schools. Electro Rabbit,

the mascot of electric safety, visited public family events,

regional safety events and kindergartens to talk about

electric safety.

140,000

120,000

100,000

80,000

60,000

40,000

20,000

0

Investments (th euros)

Investments (th euros) Estimated number of breakdowns Actual number of breakdowns

Number of breakdowns

35,000

30,000

25,000

20,000

15,000

10,000

5,000

020142010 2011 2012 2013 2015 2016 2017

More than 70% of our employees work in

Ida-Virumaa region, centre of Estonian oil shale industry

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ENVIRONMENTAL ACTIVTIES

From 1 January 2016 Estonia has to be in full compliance

with all environmental regulations of the EU. In 2015,

preparations that had lasted for more than ten years were

successfully completed and today all of Eesti Energia’s

production facilities meet the environmental require-

ments that apply in the EU. Since the EU regulations are

constantly changing we continue working to be ready for

any upcoming requirement.

In 2015 our focus was besides adjusting with EU require-

ments also on increasing the efficiency and environment

friendliness of our production capacities. This also reflects

our strategic goals: maximizing the value of oil shale based

energy, more flexible and efficient energy generation

and increasing the usage of resources by deployment of

energy by-products and production residues.

Air Emissions have Dropped Several Times Over the last five years older generating units of the

Narva power plants where the pulverised combustion

technology is used have been supplied with desulphu-

risation and denitrification (DeSOx and DeNOx) systems

that have reduced sulphur oxides emissions three times

and nitrogen oxides emissions almost two times

In addition to reducing emissions of sulphur and nitro-

gen compounds, in 2015 Eesti Energia modernised its

power plants’ electrostatic precipitators, which will sig-

nificantly reduce the quantities of fly ash emitted into

the environment. Last year, in connection with installing

For Eesti Energia, 2015 marked the end of an important period of major environmental invest-ments. The transitional easing of environmental requirements granted to Estonia on its acces-sion to the EU has expired.

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flue gas treatment systems, five new stacks were built

for the Eesti power plant that allow the Group to utilise

the generating units that meet regulatory requirements

more flexibly and efficiently and to manage production

in a volatile market situation more effectively thanks to

their enhanced emission measurement systems.

Since 2010, the Group invested EUR 134 million in

reducing the Narva power plants’ emissions to air. The

efforts and investments made allow to continue genera-

ting electricity in previous volumes and using the existing

plant and equipment in a situation where the EU environ-

mental requirements apply to Eesti Energia in full.

Last year, we were actively engaged in reducing the

Enefit140 oil plant’s emissions that may cause odour

issues. Eesti Energia invested EUR 2.1 million in moder-

nising and enhancing different production processes. As

a result, its environmental impacts decreased. Relevant

activities will continue in 2016.

New Technologies that Reduce Environ-mental Impacts and Save the Resource In order to keep up with continuously changing and tigh-

tening environmental requirements, Eesti Energia not only

implements technical solutions that reduce emissions but

also continues to invest in new and cleaner technologies.

New technological solutions help increase production

efficiency and energy and material utilisation as well as

diversify the sources of primary energy by using munici-

pal waste, biomass and energy production by-products.

Over the last five years Eesti Energia has invested more

than 1 billion euros to more efficient technologies more

environment friendly energy generation such as Auvere

power plant, Enefit280 oil plant, Iru waste-to-energy unit,

windparks and co-generation plants.

Environmental impact of Enefit140 oil plant has dropped significantly after improvement in production process.

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Over the last five years Eesti Energia has invested more than 1 billion euros to more efficient technologies and more environment friendly energy generation.

In 2015, the commissioning of the Auvere power plant

continued and first electricity was transmitted to the grid.

Final commissioning is expected in the first half of 2016.

New Auvere power plant is based on circulating fluidized

bed technology and is able to co-fire oil shale and bio-

mass on a 50/50 basis. e. The option of using biomass as

reduces the environmental impact of power generation

and increases the competitiveness of Auvere power plant

in the light of stricter European Union climate policy.

Last year, the Enefit280 oil plant produced a record

amount, 137.1 thousand tonnes of shale oil. Because

of the innovative technology of the Enefit280 oil plant,

its energy efficiency is higher than that of Enefit140 and

other oil plants operating in Estonia and its environmental

impacts are times lower. Thanks to its unique technology,

the plant can not only produce shale oil and oil shale

gas but can also use its residual heat to produce elect-

ricity. Such cogeneration enables Eesti Energia to derive

more energy and twice higher value from oil shale while

reducing the CO2 emissions of residual heat recovery and

oil shale gas based power generation by up to 40%, com-

pared to direct burning of oil shale to generate electricity.

Last year, we contributed significantly also to increasing

the generation of renewable energy. Thanks to favourable

wind conditions, in 2015 Eesti Energia achieved record-

high wind energy output – 223.3 GWh that would be

sufficient for ca 90 thousand households with average

electricity consumption for about a year.

Hydro- and cogeneration plants generated approximately

25 GWh of energy in 2015, up by 15% year-on-year.

In addition, Paide and Valka combined heat and power

plant generated more than 63 GWh of heat.

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IES Last year the Iru waste-to-energy unit used around 244.6

tonnes of mixed municipal waste which otherwise would

mostly have been deposited in landfill sites. In 2015, Eesti

Energia used mixed municipal waste at Iru to produce

269.5 GWh of heat and 128.3 GWh of electricity. Use of

mixed municipal waste for the production of heat and

electricity replaces the use of around 70 million cubic

metres of natural gas and substantially reduces the

environmental impacts of the deposition of waste.

Resources Used

2011 2012 2013 2014 2015Commercial oil shale million t 15.8 14.8 17.2 17.0 13.7

Natural gas million m3 97.7 61.1 47.3 43.7 47.1

Biofuels million t 0.4 0.5 0.1 0.1 0.1

Municipal waste thousand t 0.0 0.0 183.6 221.4 244.6

Cooling water million m3 1,522.9 1,302.2 1,475.0 1,454.5 1,365.1

Pumped mining water million m3 224.8 203.0 138.2 117.3 103.6

Water from open cast mines million m3 131.8 112.2 61.6 57.0 49.0

Water from underground mines million m3 93.0 90.8 76.5 60.3 54.7

The Group’s Investments Towards Reducing Environmental Impact

500

400

300

200

100

03322011

832015

3482012

2452013

1132014

million €

Indirectly reducing environmental impact

Directly reducing environmental impact

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More Energy from By-products Use of energy production by-products, which increa-

ses utilisation of the oil shale resource, is among Eesti

Energia’s development priorities. The oil shale industry

generates various by-products such as waste rock (oil

shale extraction by-product), burnt oil shale or oil shale

ash (electricity and oil production by-product), waste heat,

oil shale gas, etc., which can be used as raw materials.

Waste rock and crushed rock from waste rock is pri-

marily used in soft traffic roads, forest roads, squares

and parking lots. Oil shale ash is a valuable construction

material for roads and ports, construction blocks or for

neutralising acid soil or afforestation. Today, we generate

more residues than we are able to use but our ambitious

goal is to reach residue free energy generation. Number

of developments to implement this vision are under way.

In 2015, Eesti Energia recycled 2% of the 6.3 million

tonnes of oil shale ash generated on energy production

and 31% of the 6.6 million tonnes of waste rock gene-

rated on oil shale extraction.

Future Trend: More Efficient and Cleaner Production The state as the owner of Eesti Energia expects the com-

pany to add maximum value to oil shale, a resource of

national importance, and to lower the environmental

impacts of its activities. So far, Eesti Energia has been able

to make its operations cleaner and more efficient every

year. To meet the owner’s expectations also in the future,

the Group is planning to further reduce its environmental

impacts by maintaining focus on controlling emissions

to air, implementing new large- and small-scale smart

solutions for increasing production efficiency, and finding

new uses for its production by-products and waste.

The state as the owner of Eesti Energia expects the company to add maximum value to oil shale, a resource of national importance, and to lower the environmental impacts of its activities.

Iru waste-to-energy plant generates heat and electricity from

mixed municipal waste

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We understand that being a significant industrial enter-

prise our activities are impacting the neighbourhood. In

our daily operations we take the utmost care towards our

employees, customers, nature and other stakeholders of

the society. We contribute to the development of society

through meaningful support activities such as financial

investments and devoting the time and knowledge of

our employees.

Our goal is to support projects that involve the broadest

possible target group and the impact of which would

be sustainable provoking long-term positive changes in

the society.

Once a year we conduct a survey to understand how

Estonians regard the areas supported by Eesti Energia.

The 2015 survey results indicated that more than 95%

of Estonian population feels positive about the supporting

activities of Eesti Energia.

The feedback was high in all areas supported:

• education and science,

• environment protection,

• recreational sports,

• Ida-Virumaa community.

In 2015, Eesti Energia contributed a total of 525,996

euros to areas of support. In 2015 we reviewed and upda-

ted the principles of support activities which determine

the areas supported and the selection criteria of project

supported, describe the support granting procedure and

regulate the rules of procedure for sponsorship com-

mittees. The management of the Group has established

a group-wide sponsorship committee to implement the

support activities. Ida-Virumaa sponsorship committee

is responsible for supporting the development of Ida-

Virumaa community.

The description of support areas and projects supported:

https://www.energia.ee/et/toetame-teisi

SOCIAL ACTIVITIES

We contribute to the deve-lopment of society through meaningful support activities such as financial investments and devoting the time and knowledge of our employees.

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Our role is to raise young people’s interest in energy sector and increase the knowledge of energy in the society.

Promoter of Education and Science Practical education in engineering, scientific mindset and

innovative thinking are crucial for the society and Eesti

Energia. Our role is to raise young people’s interest in

energy sector and increase the knowledge of energy in

the society.

As an energy group with the longest history and the most

experience in the sector we emphasise the supporting,

developing and promoting of energy related education

as well as preserving its history.

Eesti Energia launched the youth development program

ENTRUM to promote the initiative and entrepreneurial

mindset on young people.

Over the last five years youth development program

ENTRUM has introduced the world of entrepreneur-

ship to more than 2,700 young people of ages 13–19

years. Young people from different Estonian regions have

implemented more than 500 ideas in the fields of social

entrepreneurship, technology, engineering, oil shale and

energy, eco-economy and creative industries.

Participants assure that with the experience and contacts

received from the program they can much better see their

role in the country’s development and identify themselves

with the future in Estonia.

Remarkable examples of entrepreneurial spirit include

InSpe, a labour exchange program launched by young

people in Ida-Virumaa region to fight with unemployment,

student exchange program VeniVidiVici initiated by the

students of Otepää Gymnasium and interactive e-textbook

AndroidÕpik developed by young people from Western

part of Estonia.

In the leadership of ENTRUM hundreds of partner organi-

sations and outstanding leaders from Estonia have joined

the network. Additionally, more than 140 businessmen

from different corners of Estonia have contributed to

the development of young people as mentors. In 2015

Eesti Energia supported ENTRUM youth program with

250,000 euros.

Eesti Energia not only financed but also contributed acti-

vely to the success of the program. The top management

and employees of Eesti Energia were actively involved

in developing the program concept and volunteered in

organizing the program sessions.

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Current Results

ENTRUM

PARTICIPANTS

IDEAS

WINNER

Ida-Virumaa region 2010/2011 (1 region)

Initiated 86, at the finals 26

(30%)

Youth job market InSpe

Estonian student exchange program

VeniVidiVici

Electronic studybook

AndroidÕpik

Nätrum, producer of organic

chewing gum

Viru Ilu, producer of organic cosmetics

from blue clay of Aseri

Initiated 98, at the finals 33

(34%)

Initiated 161, at the finals 42

(26%)

Initiated 171, at the finals 56

(32%)

Initiated 135, at the finals 30

(22%)

644 students 475 students 580 students 600 students 322 students

South Estonia 2011/2012 (5 regions)

West Estonia 2012/2013 (4 regions)

North Estonia 2013/2014 (4 regions)

Virumaa 2014/2015 (2 regions)

Year 2015 when ENTRUM returned to Ida-Virumaa region

was also the last year for ENTRUM program. All knowledge

and contacts were handed over to government institutions

and private entities in order to ensure the continuation of

the program. The feedback received gives us hope that

ENTRUM program will be developed further in coming years.

To secure sufficient availability of future staff we strive to

raise young people’s interest in seeking career possibi-

lities in energy sector, create cooperation opportunities

for energy students and develop energy education in

partnership with educational institutions. We have part-

nered with Tallinn Technical University (TTU) to introduce

energy and environment related subjects by lecturing on

popular science in schools across Estonia. Approximately

500 students improved their knowledge on energy sector

and gathered ideas for career planning.

We agreed with TTU that the Innovation and Business

Centre of TTU submits grant applications for promoting

and diversifying the specialty by all faculties, research

entities and student organisations twice a year. In 2015,

we supported projects improving energy education in the

amount of 20,000 euros.

We help the schools with technology and science education

by inviting students to study visits to our production facili-

ties. Over the year about we hosted about 1,600 students.

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20

Future Employee Projects Initiated or Sponsored by Eesti Energia by Age

Age

5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Electric safety trainings (5 000 kids and young people)

Energy saving learning materials

Energy Discovery Centre and Kohtla Mining Museum (100,000 attendants)

Youth to School initiative in Sinimäe (50 students)

Youth to School (30 young teachers)

Back to School guest lectures (15 classes)

Olympiads, science contests (500 young people)

TTU science clubs for stu-dents, incl Virumaa College

Eesti Energia lecture coursein TTU (100 young people)

ENTRUM (400–600 young people)

Study visits and excursions (1,600 young people)

Job shadowing (10–20 young people)

Internship (270 young people)

Guiding and instructing the thesis

Scholarships (10 future engineers)

Promoting practical learning with learning materials

INSENERGIA (15 young engineers)

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We subsidise the students’ interest in sciences through

granting special prizes in Olympiads and competitions.

We supported the national physics competition, student

science research contest and national technology camp

for students of elementary school during the school break.

In 2015 we hosted 319 inters of whom 215 were doing

their internship in our entities in Ida-Virumaa region and

68 in Tallinn.

We Care About Environment Eesti Energia is an energy company and therefore, due to

our operations, we interact with nature every day requiring

a lot of dedication, responsibility and knowledge. Our

priority is to preserve the environment. We use natural

resources responsibly, reduce the environment impact

of our operations and promote concern for environment

as a way of thinking.

Environment Day seminar held by Eesti Energia once a

year involves important stakeholders to discuss about

environment protection. Environment Day seminar held

in 2015 focused on achievements in reducing air pol-

lution in oil shale industry. From 1 January 2016 new

requirements of European Union integrated pollution

directive were fully enforced in Estonia. The new rules

set lower air pollution limits to large combustion plants.

Eesti Energia has already implemented all measures and

is in compliance with such rules. The participants of the

event included public servants from local municipalities

and ministries, environmental specialists and other rep-

resentatives of oil shale industry.

2015 was the fifth year for Eesti Energia and Looduse

Omnibuss (Nature Bus) to team up in organising popular

nature educational events. Looduse Omnibuss has turned

into a movement valuing Estonian nature and culture.

Last year close to 140 trips and 30 evening events took

place to explore nature. The fifteenth largest Estonian

nature photo contest “Nature Year Photo” led by Looduse

Omnibuss took place in spring 2015. More than 1,200

photographers with some 9,000 photos participated in

this event.

We carried out intragroup design contest to find sustai-

nable and both financially and commercially feasible solu-

tion for waste rock, a by-product from oil shale mining.

We received more than 50 ideas which considered the

development of local community and environment friend-

liness. During the development phase our employees

consulted with experts from different areas including the

geology experts from Tartu University, tourism experts

and environment specialists. Development department

continues with investigating the feasibility of the best idea.

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We are confident that by promoting healthy lifestyle the people and the whole society will have a more prosperous future.

We Value Healthy Lifestyle We create sporting opportunities and encourage people

to be physically active every day. We are confident that

by promoting healthy lifestyle the people and the whole

society will have a more prosperous future.

Eesti Energia, Swedbank and Merko Ehitus teamed up to

advance Estonian health trails. With the joint effort more

than 100 health trails nationwide have been fixed and

lighted over the last ten years. The role of the Estonian

health trails project is to make healthy regular physical

activity in fresh air accessible to everyone anytime and

anywhere in Estonia. The website of Estonian Health Trails

organisation includes more than 40 instructive videos with

useful training tips both to beginners and experienced

recreational sportsmen in different fields of sport.

The employees of Eesti Energia are also engaged in the

expansion of health trails. The collective action on health

trails has become annual tradition. The employees of

Eesti Energia and about 200 volunteers from Narva are

attending the upkeeping of Narva Pähklimäe health trail

to maintain the trails and set up new facilities for outdoor

activities.

Each year many of our own employees take part of Narva

Energy Run, a largest recreational sports event in Ida-

Virumaa region that was initiated and is still run by us. In

2015 more than 460 of our employees and their partners

took part of the event.

We encouraged our employees working in the headquar-

ters to take stairs instead of elevators and spend more

time on health trails a month before Narva Energy Run.

All stairs and kilometres were marked to posters to find

the winning team (each floor representing a separate

team). During the month more than 300 people took part

of the initiative covering close to 13,000 kilometres. The

initiative involved also other companies in the building.

Three sports clubs sponsored by the company help to

promote the employee health and organize numerous

tournaments and sporting activities.

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Partner to Ida- Virumaa CommunityOur essential attention goes to Ida-Virumaa region, a

home for the majority of our employees and the centre

of Estonian oil shale energy. By contributing to the imp-

rovement of living environment we aim to preserve the

significant local traditions, have a number of events to

be proud of and provide diverse educational possibilities

for young people.

In spring 2015 we opened an old oil shale enrichment

factory in Kohtla Mining Museum, a recently opened

unique oil shale theme park in all Europe.

The oil shale enrichment factory that employed around

hundred people in the 1930s is now home for interes-

ting displays introducing mining, production of electricity

and liquid fuels through experience and game. The exhi-

bition covers the past, present and future of oil shale

industry. Eesti Energia has donated number of machinery

and equipment used in oil shale industry. Kohtla Mining

Museum’s landbased exposition is a good example of

reutilizing industrial heritage. In addition to introducing the

industry’s history and modern technologies the museum

is also part of developing local community. The land-

based exposition is used by local governments to organize

different events. The last Miners’ Day took also place in

Kohtla Mining Museum, which is a unique attraction and

tourism object in Estonia.

In 2014, Eesti Energia initiated Energy Day, a community-

wide family event. In 2015 we continued with this tradition.

An event offering versatile entertainment program in

Narva was attended by some 4,000 people. The program

included entrainment for the smallest, local handicraft

and a concert.

The Miners’ Day, one of the longest traditions in Ida-

Virumaa region, was in 2015 organised in Kohtla Mining

Park. The event is devoted to miners and their families

but all other people are also very much welcome. On this

event with about 5,000 participants the best miners were

recognised and acknowledged.

In 2015, we supported 29 students between ages 7 and

18 through Ida-Virumaa Talented Youth Energy Fund. The

role of Energy Fund, co-established with the Association

of Local Authorities of Ida-Viru County, is to stimulate the

development of recreational activities of ambitious young

people. In 2015, the Energy Fund amounted to 9,000

euros of which Eesti Energia contributed 5,000 euros and

the Association of Local Authorities of Ida-Viru County

4,000 euros. Majority of scholarships were granted to

young people engaged in science or sports but we also

supported improvement in music, culture and arts. The

fund has awarded scholarships to 93 young people since

it was established in 2013.

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Results of Narva Energy Run

5,000

4,000

3,000

2,000

1,000

0

2,1802011

3,3692014

4,0142015

3,4292013

2,9282012

Our role in the “Young People to School” program is to

promote the engineering career in the region. Therefore,

in 2014, we invited a young and enthusiastic mathematics,

chemistry and physics teacher to Sinimäe School in Vai-

vara municipality to raise students’ interest in engineering

already in secondary school. We grant the teacher extra

scholarship of 6,080 euros to compensate moving, living,

language learning and transport related expenses.

Eesti Energia initiated recreational sports tradition in

Ida-Virumaa region to value the good feeling and health

of the people living in the region. In 2015, more than

4,000 sports fans of different ages attended the fifth

Narva Energy Run. As a charitable contribution to promote

Narva Energy Run we improved the exercising campus on

Pähklimäe health trails to provide the locals year-round

access to working out in fresh air. The ultimate goal of the

event is to inspire people in getting involved with recrea-

tional sports but also increase the position of Ida-Virumaa

region in Estonian cultural and sports scenery.

In co-operation with local municipality we are creating

possibilities to spend holidays and organise top water

sports events on former territory of Aidu opencast mine

that was closed in 2012. A 2.5 km long rowing channel

meeting international requirements will be completed

in 2017. The rowing channel filled with natural water

and the trenches of the mine are already now offe-

ring powerful and inspiring views and amazing sporting

possibilities. In 2015, watersports event Aidu Cup took

place again in Aidu as well as the water tour with more

than 600 participants. In 2015, Aidu international com-

petition site welcomed more than 850 watersports fans

and 1,000 visitors.